{"id":321058,"date":"2024-06-11T14:38:01","date_gmt":"2024-06-11T09:08:01","guid":{"rendered":"https:\/\/dripp.zone\/news\/?p=321058"},"modified":"2024-06-11T14:38:01","modified_gmt":"2024-06-11T09:08:01","slug":"velocity-at-13-year-standstill-will-btc-payments-ever-breakthrough-crypto-news","status":"publish","type":"post","link":"https:\/\/dripp.zone\/news\/velocity-at-13-year-standstill-will-btc-payments-ever-breakthrough-crypto-news\/","title":{"rendered":"Velocity At 13-Year Standstill, Will BTC Payments Ever Breakthrough? – Crypto News"},"content":{"rendered":"

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Despite Bitcoin\u2019s inception over a decade ago with Satoshi Nakamoto\u2019s vision of facilitating peer-to-peer electronic cash transactions, its current usage mirrors its early days. The Bitcoin (BTC) transactions are circulating at a pace reminiscent of 13 years ago. This revelation comes from CryptoQuant CEO Ki Young Ju, who highlighted the stagnation in Bitcoin\u2019s velocity.<\/p>\n

Bitcoin Velocity Stagnates<\/h2>\n

Ju noted that the trend indicates a shift towards the digital gold narrative rather than widespread adoption for daily transactions. The concept of Bitcoin as \u201cDigital Gold\u201d has gained traction. Hence, institutions are increasingly holding onto the cryptocurrency as a store of value rather than utilizing it for frequent transactions.<\/p>\n

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Source: Ki Young Ju | X<\/figcaption><\/figure>\n

The velocity of Bitcoin transactions, depicted in a chart shared by Ki Young Ju, stands at a level similar to that of 2011. This reflects a long-standing trend of sluggish movement in the Bitcoin ecosystem. Though the Bitcoin velocity spiked several times in these 13 years, it\u2019s now back to the 2011 levels, according to CryptoQuant.<\/p>\n

Nick Tomaino, a former Coinbase executive, recalled the early days of Bitcoin adoption. He noted that Coinbase initially raised significant funding under the premise that Bitcoin would revolutionize payments and spur the creation of new applications. However, the reality differed as the platform onboarded merchants like Overstock to accept Bitcoin, but the long-term viability of Bitcoin payments proved elusive.<\/p>\n

Tomaino\u2019s insights shed light on the challenges faced by Bitcoin as a payment method. It also emphasizes the lack of a compelling business case for Bitcoin payments in the face of emerging alternatives like Ethereum and decentralized applications. Moreover, he highlighted how Ethereum\u2019s inception changed the entire crypto payments game.<\/p>\n

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Also Read:\u00a0Bitcoin Notes $2B Inflows But Ethereum Steals The Spotlight, Here\u2019s Why<\/a><\/strong><\/p>\n

Limitations Of BTC Payments<\/h2>\n

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Zach Rynes, a Chainlink community liaison, delved deeper into the technical limitations of Bitcoin for payments. He particularly highlighted Bitcoin\u2019s lack of programmability compared to Ethereum and other blockchain platforms. Rynes highlighted two crucial issues: volatility risk and payment accuracy, both of which are critical for merchants considering cryptocurrency payments.<\/p>\n

Rynes explained that Ethereum\u2019s smart contract capabilities allow for seamless conversion of crypto assets into stablecoins. Hence, it mitigates volatility concerns for merchants. Additionally, Ethereum\u2019s programmability enables automatic validation of payment amounts. This reduces the burden of manual reconciliation for incorrect payments.<\/p>\n

In contrast, Bitcoin\u2019s UTXO-based architecture presents hurdles for implementing similar functionalities directly on its blockchain. While Lightning Network offers potential solutions for validation issues, challenges persist in managing liquidity and scalability. This limits its effectiveness in addressing Bitcoin\u2019s payment shortcomings.<\/p>\n

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Furthermore, Rynes\u2019 analysis underscores the complexity of Bitcoin payments. It also emphasizes the necessity for pragmatic solutions to accommodate merchant requirements while maintaining decentralization and non-custodial principles.<\/p>\n

Despite the backlash from Bitcoin maximalists, Rynes maintains that acknowledging Bitcoin\u2019s limitations in payment processing is essential for driving innovation. However, Bitcoin maximalists also see a hope in the rise of BTC payments as the Layer 2 network is making great progress toward the target. Nonetheless, Layer 1 BTC payments might not go mainstream anytime soon.<\/p>\n

Also Read:\u00a0How Bitcoin Will Benefit From End Of US-Saudi Petrodollar Deal<\/a><\/strong><\/p>\n

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CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article. <\/p>\n<\/p><\/div>\n

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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.<\/p>\n<\/div><\/div>\n<\/p><\/div>\n

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Despite Bitcoin\u2019s inception over a decade ago with Satoshi Nakamoto\u2019s vision of facilitating peer-to-peer electronic cash transactions, its current usage mirrors its early days. The Bitcoin (BTC) transactions are circulating at a pace reminiscent of 13 years ago. This revelation comes from CryptoQuant CEO Ki Young Ju, who highlighted the stagnation in Bitcoin\u2019s velocity. Bitcoin […]<\/p>\n","protected":false},"author":2,"featured_media":321060,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[173],"tags":[201,248,251,246,257,255,250,252,247,253,249,256,254],"class_list":["post-321058","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-others","tag-blockchain","tag-bsc","tag-chainlink","tag-coin","tag-cryptocurrency","tag-gta","tag-looks-rare","tag-oracle","tag-polygon","tag-quickswap","tag-safe-moon","tag-wallet","tag-wordpress"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/321058","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=321058"}],"version-history":[{"count":3,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/321058\/revisions"}],"predecessor-version":[{"id":321062,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/321058\/revisions\/321062"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/321060"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=321058"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=321058"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=321058"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}